Section III. Portfolio Construction
a) Calculate the expected returns and standard deviations on the
following portfolios:
a. Portfolio 2: 45% Bank Shares, 25% Industrial Shares and 30% Resource
Shares - 3 Marks
Arithmetic Mean
Geometric Mean
Cumulative w
1. Coca-Cola and Pepsi are competing in the Brazilian soft-drink market. Each firm is deciding
whether to follow an aggressive advertising strategy, in which the firm significantly
increases its spending on media and billboard advertising over last years
1. The Tiny Island has a population of 5000 and currently has no tax on beer.
However the government is considering a tax of $1.50 per dozen pack of beer.
You are asked to conduct an economic analysis of the proposed tax, given the
following estimates of
1.Use the following two statements to answer this question:
I.A market is a collection of buyers and sellers that, through actual or potential interactions,
determine the price for a product or set of products.
II.An industry is a collection of markets fo
1. Use the following two statements to answer this question:
I.
A market is a collection of buyers and sellers that, through actual or potential interactions,
determine the price for a product or set of products.
II. An industry is a collection of markets
1. A monopolist has the following demand and cost functions: TC = 80 + 0.5Q2 and
P = 40-1.5Q
(a)
Calculate the profit maximizing price and quantity for the monopolist.
(b)
What output and price would prevail if this industry operated under perfect
competi
1. The Woodcutters Limited runs a tree-cutting service. Its TC is as follows:
TC = 200 + 4q + 2q2, where the TC is total cost in dollars and q is the number of
trees cut per day.
(a)
(b)
(c)
(d)
If the firm is operating in a perfectly competitive market,
1. Suppose the production function for CDs is given by
Q= 600L2-L3
Where the Q is the number of CDs produced per year, K is the machine-hours, and L is the labor
hours.
(a) Derive the marginal product (MPL) and average product functions (APL) for labor.
(
1. Suppose a small firm has a budget of $30 per day. The firm can buy a unit of
capital at $5 and a unit of labour at $1. The firms production function is given
by Q = K*L, and the firm wishes to produce 45 units of output.
(a)
(b)
Draw the isocost line i
BEO2264 Microeconomic Analysis Assignment: Semester 2, 2016
_
Due Date: The completed assignment must be submitted to your lecturer during your
scheduled seminar, the week beginning the 10th of October, 2016.
Value: 20% of Total Assessment
You should atta
Assignment 2
Task 1
3. Compute the average returns (means), standard deviation (risk), geometric mean, the inflation
adjusted cumulative wealth index, and the chances of having negative return for each investment.
Interpret the results based on investment